Workplace Redesign: Current Trends, Challenges, and ...

Workplace Redesign: Current Trends, Challenges, and Opportunities

A CAHRS White Paper | May 2019 Prepared by Nathan Adams, Rachel Allen, and Emeka Ojukwu

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Executive Summary

As new technological advances arise, the way we work will continue to evolve as well. In order to keep up with this trend, companies have taken on the daunting task of changing their workspaces to better align with their needs. While some organizations focus on cost saving initiatives, others move forward with the explicit intention of changing the behavior of their workforce. Regardless of what motivates an organization, there is no single workplace layout that will guarantee success. With this in mind, this research paper is a collection of best practices from various organizations across different industries for those considering a workplace redesign. We've gathered these insights to assist organizations in making intentional decisions throughout their own redesign process in order to maximize their impact.

Methodology We collected this data by interviewing representatives from 25 organizations. The participants spanned different roles, including Director of HR, Head of Real Estate, and Director of Organizational Design. Our interview process enabled us to define three distinct chronological stages of a redesign: the planning stage, the design & pilot stage, and the post-implementation stage.

Findings

Phase 1 (Planning Stage) This stage is defined by organizations who are in the early portion of the redesign process. These organizations were either still collecting data, deciding on workplace layouts, or were waiting to hear back from those higher up before they could proceed.

Key Takeaways: 1) Define your motivation: A financially driven redesign process can look drastically different than a strategy meant to explicitly change workforce behavior. Knowing the driving force for the redesign from the beginning will enable organizations to make intentional decisions to accomplish their goal. 2) Room for increased HR involvement: HR's unique position as the voice of the employee can be better utilized not only in the early decision-making process, but throughout this initiative. Organizations should utilize HR more in this early stage to make design choices based on their understanding of workers and to initiate the change management process.

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Phase 2 (Design & Piloting Stage) This stage is defined by organizations who are just starting to engage employees in the process all the way to those engaged in rolling out their redesign plans.

Key Takeaways: 1) Employee engagement is crucial: Engaging with employees and getting their feedback early on in the process proved to be crucial for later success and ease of change management. Organizations shouldn't be afraid to get creative with this process and utilize different avenues of getting employees to brainstorm the ideal workplace situation. 2) Losing an office is a pain point: Many companies described being surprised by how attached employees felt to their offices. As a result, we recommend organizations establish a plan for offices before the redesign, and to start communicating the "why" behind this move to affected employees as soon as possible.

Phase 3 (Post-Implementation Phase) This stage is defined by organizations who have finished their redesigns and are now collecting data on the effects of their initiative.

Key Takeaways: 1) Invest in change management: Organizations declared change management not only as their biggest challenge, but also their biggest regret. We recommend organizations engage with their HR teams early on in the design process in order to give them sufficient time to create and implement more effective change management efforts. 2) No clear way to measure success: Currently, no straightforward easy and accurate method of measuring success exist and it is something all the organizations we spoke to are struggling with. Despite this, we recommend organizations consider new innovative methods to assess progress. Some of these methods include using sociometric badges to measure the number of new collisions or even using a third party to hold observation studies on their behalf.

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I. Why Study Workplace Design?

Workplace design has been top of mind for organizations and academics alike. Designs and redesigns can range in size and scope from simply updating the furniture of a space, to completely shifting from cubicle seating to Activity-Based Working (ABW) arrangements. In recent years, there have been shifts from traditional ways of working, like cubicles and assigned seats, to more progressive designs, like completely open layouts or hoteling arrangements for employees. The rapid emergence of these new strategies of working has created an equally rapid rise of conflicting information regarding their efficacy. One design strategy, open layouts, is regularly at the center of this debate. A 2018 study published in Occupational & Environmental Medicine found that workers in organizations with open office spaces felt less stressed and more active than workers in the aforementioned traditional workplace setting [1]. A frequently cited Harvard study published the same year found that workers in open settings are less likely than their cubicle working counterparts to engage in face-to-face interaction and more likely to communicate electronically[2]. This anecdote is just one example of the conflicting findings that exist within the field of workplace design. The purpose of this report, in part, is to provide insights and propose considerations for organizations who have or are currently pursuing a workplace redesign.

Workplace redesigns can have a profound impact on numerous factors that underlie an organization's performance. Redesigns are often executed with the goal of increasing productivity and engagement, decreasing costs associated with real estate, and even enhancing the attraction and retention of talent. Despite the drastic implications a redesign can have on employees, there is no single right way to conduct one, leaving many organizations to struggle with the process.

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II. A Brief History of Workplace Redesign

Cubicles/Closed Spaces The modern-day office cubicle was an attempt by Robert Probst to create a more pleasurable workplace environment. Through building off of the office landscape idea made popular by Wolfgang and Eberhard Schnelle in 1958, Probst created the notion of the Action Office in 1964.[3] Originally, his plan centered on giving employees more control over their workspaces. This meant providing a three walled space of fabric wrapped wood that was flexible enough for anyone to adjust to their needs. Regular employees could now personalize their space, have more privacy, or even create an impromptu conference room by joining pieces together if the need arose. Probst's creation would ultimately come to be known as the cubicle. Within no time, companies saw this as an avenue to cram as many people into as little space as possible in order to bring down costs.[4] They allowed employees to decorate the space with pictures, but drastically restricted their ability to customize it. Instead, they standardized the threewall format to what we now associate with the standard cubicle. From there, they mass produced these mini cubicle-like offices to fill the space where desks once stood. While the cubicle does allow for personalization and more privacy than was previously available, it created a sense of isolation among employees. Current popular culture associates the cubicle with soul crushing mundane office work while also blaming it for isolating people and departments alike.[5]

Open Spaces The desire to dismantle these inner and outer silos is what precipitated the current trend of open space design. This trend gained momentum in the 2000's as technology companies were looking for new ways to disrupt the status quo. Part of that disruption revolved around reconsidering whether the dominant cubicle plan was appropriate for their organizations. While many people had some appreciation for the privacy cubicles offer, these companies viewed them as deterrents to collaboration. By breaking down these walls, companies were hoping to boost communication amongst employees, which would hopefully boost innovation.[6] With work no longer centered around a set routine of tasks, the ability to innovate and match new age consumer trends became a priority for these tech and media companies.

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The switch to open offices was aimed at creating a vibrant environment characterized by increased collaboration. The hope was that by removing the physical dividers, employees would be better able to have more of what researchers in the field call collisions.[7] A collision is an unplanned encounter that produces something good for the company or for the individuals involved. Each unplanned engagement is a collision as it represents an opportunity for the sharing of ideas and the strengthening of working relationships.

Like any new thing, the reality of the open office space did not always live up to expectations. Naturally, one of the main complaints is the lack of privacy. While upper management still gets their corner offices, employees are brought into the view of the watchful eyes of each other, which can be daunting.[8] Another common complaint centers around the potential for over stimulation. While the cubicle may not have been the prettiest thing, they did serve the purpose of limiting outside distractions, like noise. Once the walls came down, employees are bombarded with extra noise from conversations they would not have heard previously, distracted by the computer screen of someone else watching YouTube videos, or are constantly being interrupted by someone who wants to chat.[9] These constant distractions and the lack of privacy have driven many to resent the open office space design.

Activity Based Working Despite its limitations, many companies have continued to pursue the open office design due to its cost saving benefits.[10] At the same time they have begun to explore ABW as a way to ameliorate some of the negatives of the open space environment. ABW focuses on creating adaptable spaces that can be organized to match people's needs. For example, ABW could entail a company creating designated huddle spaces for group discussions, quiet rooms for those who don't want to be disturbed, and collaboration booths for the impromptu meeting.[11] ABW is often implemented in conjunction with an open office design as a way to mitigate the distractions that can arise by providing these alternative spaces to work.

ABW benefits employees by giving them more autonomy on how and where their work gets done. With employees no longer limited to their desk for eight hours a day, they are free to find the ideal space that is beneficial for their productivity. In order to work

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properly, ABW does require a companywide cultural shift. Employees may find themselves more accustomed to more traditional work methods and find their new autonomy somewhat discomforting.[12] This can create tension when they decide to pass judgment on others who exercise their right and work away from their desks much more often. The more traditional person may assume that the other is not pulling his or her weight because of this. Thus, it is important for leadership to implement appropriate change management methods when implementing ABW. Getting everyone to see the benefits and realize that accountability remains central to their success is key.

III. Study Design & Methodology

The findings of this study were based on interviews conducted during the months of March and April 2019 that typically lasted about 45 minutes. The interviews were structured, using the template found in Appendix on page 23. Interview topics included questions about the strategy behind the workplace redesign, process of the redesign, and post-implementation. Organizations were asked to volunteer for the study, regardless of whether they had recently completed a redesign. Participating organizations were given the questions one week in advance, and the organizations were responsible for selecting representatives that could best speak to the redesign process. Titles of the participants tended to span functions, ranging from Director of HR, to Head of Real Estate, to Director of Organizational Design. The participating organizations spanned several industries (see Appendix on page 23 for full list); however, due to the sample size, industry-effects were not examined. Once the qualitative data was obtained, it was compiled into a master file for analysis. In addition to interview data, insights from an extensive lit review, as well as from conversations with redesign consultants, were included in the analysis.

IV. Workplace Redesign Strategy Spectrum

To help make sense of the data that was collected from participating organizations, we created a model that functions across two separate axes. This model is shown in Figure 1 on page 8. The first axis is the initial motivation of an organization for pursuing a redesign. There were two primary motivators for organizations: financial motivations and people motivations. Almost all organizations stated a dominant motive focused on

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either financial objectives or people objectives. However, many organizations cited other factors from the non-dominant motive that pulled them closer to the center of this model. The second axis of this model is the stage of the organization's redesign. Using our data, we were able to establish three chronological stages of a redesign: the planning stage, the design & pilot stage, and the post-implementation stage. We then placed each participating organization in the model based on their primary strategic drivers and where they were in their redesign process. Each organization is represented by an X.

Figure 1. Workplace Redesign Strategy Spectrum

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